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Property Tax Depreciation is something we often don’t appreciate or more commonly just don’t understand at all. As a property investor in Australia’s growing property market I’ve recently learnt there is no greater time to further educate ourselves and better our understanding of how Property Tax Depreciation can boost our financial position potentially allowing unexpected growth – and Napier & Blakeley’s NBtax makes sure all the boxes are ticked!
A few years ago Property Tax Depreciation schedules were something that my accountant prepared for my investment properties. I didn’t know what it was, how it worked, or the true value of it. I just knew it helped me to negatively gear my property and that my accountant looked after it.
Over the past few years I’ve been lucky enough to continuously grow my property portfolio and with interest rates where they are, I’ve started to pay more attention to what’s involved when it comes to my property investment returns.
The first thing I learnt was Property Tax Depreciation actually plays a very big part in maximizing my return or more importantly minimizing my taxable income. AND, unbeknown to me, my accountant isn’t the right person to calculate my property depreciation. It took some reading and investigating but I learnt exactly how depreciation should be calculated. It became evident that my ignorance had been costing me.
Property tax depreciation is complicated. It’s a combination of two deductions or allowances. Capital Allowances or otherwise known as depreciation allowances – these are all the items within your property such as air conditioners, heaters, white goods, ovens, stove tops etc. Now ‘technically’ your accountant can calculate the opening depreciation value of these items because we can estimate their retail cost and then apply the depreciation rates. But will they estimate correctly? It’s a risk – unless you know exactly how much they cost, all the costs associated and factor in your purchase price of the property itself!
The other tricky part of Property Tax Depreciation are the Building Allowances which form the second part to the total depreciation calculations of your investment property. Building Allowances is essentially the depreciation of the structure of your property. The walls, the ceiling, the actual building. This is where your accountant quite probably doesn’t have the skills. To properly assess the Building Allowances of your property you need a skilled Quantity Surveyor to analyse your entire property. Only an experienced Quantity Surveyor will understand the construction elements within your property, they quantify everything from the concrete under your feet, to the plaster and timber batons in your walls. The Trusses in your ceiling and the metal or tile roof you might have over your head. An experienced Quantity Surveyor is the right professional to assess the cost and value of these things, and then apply the depreciation rates – and more importantly to ensure you get the best depreciation available which should enable you to ensure you minimize your taxable income.
Not knowing the true depreciable value of your property asset could mean you’re missing out on tens, if not possibly hundreds of thousands of dollars of depreciation over the life of your investment. That’s money you’re missing out on!
One of the problems investors face is finding the right property tax depreciation specialist. When you hit up Google with relevant searches to find the right property tax depreciation specialist, there are all sorts of sites offering depreciation schedules. Some super cheap, some not so – to ensure you pick the right specialist you need to know that your property will be thoroughly inspected by the right professional and that your schedule will be completed by Quantity Surveyors with the know-how. You definitely do not want a depreciation schedule that’s calculated automatically based purely on the date of purchase and purchase price of your property. This would be a decision that could cost you thousands – and you wouldn’t even know it.
In the mid 1980’s, before there was even the internet available to us all, residential property depreciation was introduced to the Australian taxation system, there was but one specialist consultant at the time, Napier & Blakeley. 30 years on Napier & Blakeley are still the Property Tax Depreciation market leaders. With such a wealth of knowledge covering the entire country – there’s only one company I will place my faith in when it comes to my property depreciation schedules.
Now, after more than 3 decades, Napier & Blakeley wanted to make the process of understanding the importance of and obtaining a Property Tax Depreciation schedule easier than ever before.
So, just this July, Napier & Blakeley introduced NBtax.com.au - a complete cloud based platform that is connected with the Napier & Blakeley national network of actual Quantity Surveyors. You can now request your residential property depreciation schedule 100% online within just a few minutes, and know that there is an experienced Quantity Surveyor at the other end receiving your request, analyzing your property and completing your schedule.
It’s clear, NBtax by Napier & Blakeley takes Property Tax Depreciation seriously – they understand the importance of time, they don’t try and sell you anything but knowledge. Knowledge that will give you the power to make the right choice. When it comes to NBtax, their goals are simple.
Educate investors, help cut their taxable income, and put more money in their pocket.